CFO Signals™

What North America’s top finance

executives are thinking—and doing
3rd quarter 2018
High-level report

This report is a subset of a full report containing analysis and trends specific to industries and
geographies. Please contact nacfosurvey@deloitte.com for access to the full report.
About the survey
Contents and background

About the CFO Signals survey Contents

Each quarter (since 2Q10), CFO Signals has Findings at a glance 3
tracked the thinking and actions of CFOs Summary and context 4
representing many of North America’s largest and
most influential companies. Topical findings 5
Longitudinal data and
All respondents are CFOs from the US, Canada,
survey background 15
and Mexico, and the vast majority are from
companies with more than $1 billion in annual
revenue. For a summary of this quarter’s Additional findings in full report
(please contact nacfosurvey@deloitte.com)
response demographics, please see the sidebars
• Detailed findings (by industry)
and charts on this page. For other information
about participation and methodology, please • Industry-by-industry trends
contact nacfosurvey@deloitte.com. • Country-by-country trends

Survey responses
Survey period: 8/6-8/17
Participation by country* Participation by industry*
33
Total responses: 132
32
• CFO proportion: 100%
Mexico
7% • Revenue >$1B: 86%
Canada
8% • Public/private: 74%/26%
17

11 12 12 Survey leaders
Greg Dickinson
6 6 Managing Director, CFO Signals
US 3 Deloitte LLP
85%
Joe Guintu
Senior Manager, CFO Signals
Deloitte & Touche LLP
Lori Calabro
* Sample sizes for some charts may not
Editor, Global CFO Signals
sum to the total because some
Deloitte LLP
respondents did not answer all
demographic questions.
Contacts
Sanford A. Cockrell III
National Managing Partner, US CFO Program
Deloitte LLP
Global Leader, CFO Program
Deloitte Touche Tohmatsu Limited
2 Deloitte CFO Signals™
Findings at a glance
Perceptions
How do you regard the current/future status of the North American,
European, and Chinese economies? Perceptions of North America declined,
with 89% of CFOs rating current conditions as good (down from the survey high
of 94% last quarter), and 45% expecting better conditions in a year (down from
52% and lowest in two years). Perceptions of Europe declined significantly to 32%
and 23%, from 47% and 36%, respectively, and China declined to 37% and 27%
from 55% and 31%. Page 6.
What is your perception of the capital markets? Seventy-three percent of
CFOs say debt financing is attractive (same as last quarter). Attractiveness of
equity financing increased for public company CFOs (from 36% to 42%) and for
private company CFOs (from 45% to 53%). Seventy-one percent of CFOs now
say US equities are overvalued—up from last quarter’s 63%. Page 7.
Sentiment
Overall, what risks worry you the most? CFOs express strong external
concerns about geopolitical and economic events (especially around trade policy
and interest rates). Similar to last quarter, they cite pressures to execute on their
growth plans, voicing growing internal concerns about driving initiatives, and
finding talent. Page 8.
Compared to three months ago, how do you feel about the financial
prospects for your company? The net optimism index fell from last quarter’s
+39 to +36 this quarter. Forty-eight percent of CFOs express rising optimism
(same as last quarter), and 12% express declining optimism. Page 9.
Expectations
What is your company’s business focus for the next year? CFOs indicate a
declining bias toward revenue growth over cost reduction (59% vs. 20%) and a
slightly lower bias toward investing cash over returning it (56% vs. 19%). The
bias toward current offerings over new ones shifted back to current offerings this
quarter (43% vs. 37%), and the bias toward current geographies over new ones
increased somewhat (67% vs. 16%). Page 10.
Compared to the past 12 months, how do you expect your key operating
metrics to change over the next 12 months? Revenue growth expectations
declined from 6.3% to 6.1%. Earnings growth declined from 10.3% to 8.1%.
Capital investment slid from 10.4% to 9.4%. Domestic hiring fell from 3.2% to
2.7%. Dividend growth rose sharply from 4.8% to 7.4% (highest level in eight
years). Page 11.
Special topic: Future of finance work, workforces, & workplaces:
Finance operations
What changes in the finance workplace operations are projected to occur
in the next three years? CFOs expect a shift in finance function responsibilities
that may influence where and how finance teams operate and interact, including a
technology-enabled workforce that may operate with more shared service centers
of excellence. Page 12.
3 Deloitte CFO Signals™
3Q18 Survey Highlights
• Optimism regarding the health and trajectory of the North
American, European, and Chinese economies declined.
• With US equity markets hitting new highs, 71% of CFOs say
equities are overvalued.
• Own-company optimism declined, largely due to increased
pessimism in the US and Canada.
• Growth expectations for revenue, earnings, capex, and hiring
declined; dividend expectations hit highest level in eight years.
• CFOs expect finance function responsibilities to change,
envisioning a technology-enabled workforce that may shift more
operations to shared service centers of excellence.
• Relative to today’s state, CFOs foresee a large increase in the gig
economy, shared service centers, and offshore finance
operations, along with a rising need to address evolving talent
requirements.
• The key skills organizations need to develop/further develop to
support the finance function will likely be related to analytical
skills, digital technologies/automation, and core business skills.
Special topic: Future of finance work, workforces, & workplaces:
Finance workforce
How will the composition of the finance workforce in three years compare
to today? CFOs expect a large relative increase in the gig economy, shared service
centers, and offshore finance operations, overlaid with the growing need to address
the evolving talent requirements. Page 13.
Special topic: Future of finance work, workforces, & workplaces: Skills
for the finance organization of the future
What are the top skills organizations need to develop/further develop to
effectively deliver finance three years from now? Greater than two-thirds of
CFOs indicated that the key skills to develop/further develop to support the finance
function in three years will be related to analytical skills, digital
technologies/automation, and core business skills. Page 14.
Summary and context
Fading optimism, led by trade, tariffs, and talent concerns
At the start of the year, CFO optimism hit a new
survey high in the wake of tax reform and
continuing positive global economic news; several
growth metrics also reached multi-year highs.
Last quarter, optimism tapered a bit, but
expectations for revenues, earnings, and hiring
rose again.
This quarter, however, CFO optimism, while still
strong, appears to be on the retreat, amid
concerns around global trade and interest rates,
combined with the evolving challenge to both
identify finance talent and equip teams with the
analytical skills they need.
Their assessments of the current North American
economy declined slightly this quarter—from
94% to 89%—but perceptions of conditions in
both Europe and China declined markedly
(although they still remain higher than their two-
year averages). In addition, expectations for
economic strength in a year were below the two-
year average in each region. Own-company
optimism also fell for the second straight quarter
and now sits below its two-year average.
In fact, net optimism fell to +36 from +39,
reaching its lowest level since 3Q17. In addition,
there was a spike in CFOs’ views that the equities
markets are overvalued, with 71% of surveyed
finance chiefs saying the markets are too high—
up from last quarter’s 63% (but still below the
When asked about their most worrisome risks, trade
policy topped the list of external concerns, with CFOs
increasingly citing the possibility of additional tariffs
and escalating trade tensions as having negative
effects on corporate performance. It should be
noted, however, that for the first time in 2018, CFOs
viewed internal risks (40%) as more constraining to
company performance than external risks (37%).
With finance talent continuing to be the top
constraining internal risk, the survey asked CFOs
this quarter about the mechanisms in place and
projected dynamics related to the evolving finance
workforce, workplace, and skills.
The majority of CFOs foresee a shift beyond
accounting, reporting, and compliance to finance
staff more adept in analysis, prediction, and decision
support. Accompanying that shift will likely be new
accountabilities supplemented by technology.
To address the evolving talent requirements, CFOs
indicated an intention to shift the composition and
locale of the workforce, including increased
utilization of outsourced, contingent, or gig workers,
and higher utilization of shared services or offshore
personnel over the next three years. They do
indicate, however, that the nearshore workforce
would still comprise the bulk of the finance
department.
Finally, to gain insight into where the biggest gaps in
Key developments since the 2Q18 survey
• The US economy grew 4.2% in the second quarter, its
fastest rate since 2014. Consumer and business
spending, along with increases in exports and
government expenditure contributed to the growth.
• US inflation hit a six-year high of 2.9% in July;
unemployment continued its 18-year low and fell
further to 3.9%; however, wages continued to stagnate.
• The US 10-year bond yield remained relatively
unchanged; 10-year/2-year spread narrowed to its
tightest level since 2007.
• US equities increased from last quarter’s survey.
• Oil prices continued to rally after reaching their highest
levels since 2014 in May.
• US trade tensions with China continued; Trump
Administration imposed 25% tariffs on second wave of
goods worth $16B.
• Canada’s job market remained relatively unchanged;
Bank of Canada raised interest rates to 1.5%.
• Mexico elected a new president, Andrés Manuel López
Obrador, on July 1.
Summary of CFO sentiment
and expectations This
quarter
Last
quarter
2 yr.
avg.
Economy optimism—North
America (Index)
43.9 50.6 44.5

above-80% levels of late 2017). skills exist in current finance functions, CFOs were Economy optimism—Europe 11.5 26.6 17.3
asked where they saw the need for most (Index)
Growth expectations also took a hit with revenue, development. There was a great variation of Economy optimism—China 20.9 26.6 21.1
earnings, capital spending, domestic personnel, responses, but greater than two-thirds agreed that (Index)

and domestic wages expectations all decreasing three specific skills needed the most development: Own-company optimism +36.4 +39.2 +40.3
(Net)
from last quarter. Still, they all remain above analytical skills, digital technologies/automation, and
Revenue growth
their two-year averages (except earnings, which core business skills. (YOY)
6.1% 6.3% 5.3%
sits just 0.3% lower). Earnings growth 8.1% 10.3% 8.4%
(YOY)
On the other hand, dividend growth expectations
Capital investment growth
rose sharply, to its highest level in eight years. 9.4% 10.4% 8.5%
(YOY)
Interestingly, more CFOs indicated in the 1Q18 Domestic personnel growth 2.7% 3.2% 2.4%
survey that US tax reform would likely lead to (YOY)
higher spending on domestic operations (46%) Percent of CFOs saying
71% 63% 76%
and higher wages (38%) than to fund dividends US equity markets overvalued
(31%). Well below two-year average Well above two-year average
Well below last quarter Well above last quarter

4 Deloitte CFO Signals™

Topical findings
Perceptions
Assessments of regional economies

Surveyed CFOs’ assessments of the North Economic optimism

American, European, and Chinese current How do you regard the North American, European, and Chinese economies? Percent of
and future economies declined from last CFOs saying current conditions are good or very good, percent saying conditions next year will be
quarter. Their sentiments toward current better or much better, and percent saying both (dotted line).
conditions in each region, however,
remained higher than their two-year North America
averages, whereas expectations for 100%
89%
economic strength in a year was below 80%
the two-year average in each region. 60% 45%
44%
40%
Surveyed CFOs’ optimism about the North 20%
American economy declined, but stayed 0%
strong, with 89% of CFOs rating current
conditions as good (down from survey high
94%). Forty-five percent expect better
conditions in a year (down from 52% and Europe
lowest in two years), and the region’s 100%
optimism index1 declined to +44—down from 80%
last quarter’s +51, but still strong. 60%
40% 32%
Perceptions of Europe’s current state receded 20% 23%
significantly over the last two quarters after 12%
0%
hitting a new survey high at the beginning of
the year. Thirty-two percent of CFOs now say
current conditions are good, and 23% expect
better conditions in a year—both metrics down China
from last quarter’s results of 47% and 36%, 100%
respectively. The optimism index1 declined 80%
from last quarter’s +27 to +12. 60%
40% 37%
27%
Perceptions of China’s economy also receded 20% 21%
significantly this quarter after rising to new 0%
survey highs over the last three quarters.
Thirty-seven percent of CFOs say current
conditions are good (a sharp decline from
55%), and 27% expect better conditions in a Good now Better in a year Economic optimism index1
year (down from 31%). The optimism index1 1 Indexes reflect the percentage of respondents who rate current economic conditions as “good” or “very good”
declined from last quarter’s +27 to +21. and who also expect “better” or “much better” conditions in a year. Please note that the calculation of this index
changed in 1Q18 and all values from prior quarters have been recalculated based on the new methodology.
6 Deloitte CFO Signals™
Perceptions
Assessments of markets and risk

Equities remain overvalued, but more so Equity market valuations

As we ride one of the longest bull markets in How do you regard US equity market valuations? Percent of CFOs saying markets are
US history, surveyed CFOs are now more likely overvalued, undervalued, or neither (compared to S&P 500 price at survey midpoint)
to say markets are overvalued, reversing their 100% 2,833 3000
trend from the last two quarters. This quarter, Overvalued
80% 2800
71% of surveyed CFOs say US equity markets 60%
71%2600
S&P 500 price
are overvalued—up from last quarter’s 63%, (right-hand axis)
2400
40%
but still below the above-80% levels of late Neutral 24%2200
20% 2000
2017. Undervalued 5%
0% 1800

Debt/equity attractiveness
Debt remains attractive; equity How do you regard debt/equity financing attractiveness? Percent of CFOs citing debt
attractiveness increasing and equity attractiveness (both public and private companies)
Seventy-three percent of surveyed CFOs say
100%
debt financing is attractive, on par with last Debt attractive
quarter and at its lowest level in more than 80%
73%
two years. Attractiveness of equity financing 60%
Equity attractive
increased for both public company CFOs (from 40% 45%
36% to 42%) and private company CFOs (from 20%
45% to 53%). 0%

Risk appetite
Decreasing appetite for risk-taking Is this a good time to be taking greater risk? Percent of CFOs saying it is a good time to
Fifty-six percent of surveyed CFOs say now is a be taking greater risk
good time to be taking greater risk—down
100%
slightly from last quarter’s 58% and in line
80%
with the two-year average.
60%
56%
40%
20%
0%

7 Deloitte CFO Signals™

Sentiment
Most worrisome risks

CFOs viewed internal risks (especially Most worrisome risks

talent) as more constraining to company
performance than external risks for the
first time in 2018. Still, they continue to
express strong external concerns around
politics (especially trade policy).
What external and internal risk worries you the most? Paraphrasing and normalization of
CFOs’ most common free-form comments
External risks

Prior to 2017, CFOs’ top external risks centered

heavily on slow economic growth. With global
economic performance continuing to improve
over the last several quarters, CFOs’ worries are
now focused on how to deal with geopolitical
and economic events.

This quarter, CFOs were overwhelmingly worried

about trade policy and tariffs, coupled with
uncertainty within the political and regulatory Internal risks
landscape. Their worries around economic
growth and interest rates continued.

When it comes to internal risks, the worries

remained relatively static from the previous
quarter, with talent (including retaining top
talent and acquiring talent with specialized
skills) being the main concern. Related were
worries about organizations’ ability to focus and
execute, supporting growth and change.

For the first time in 2018, however, CFOs

viewed internal risks (40%) as more Growth constraints
constraining to company performance than Which factors (external or internal) are most constraining your company’s performance?
external risks (37%).
Please see the full report for specific CFO 10% 27% 23% 32% 8%
comments by industry.

0% 25% 50% 75% 100%

Much more external More external Neutral More internal Much more internal

8 Deloitte CFO Signals™

Sentiment
Optimism regarding own-company prospects

After hitting a new survey high in 1Q18, Own-company optimism

net optimism fell for the second
consecutive quarter—despite a sharp
increase in optimism in Mexico; Services
and Healthcare/Pharma improved, and
Technology declined sharply.
How does your optimism regarding your company’s prospects compare to last
quarter? Percent of CFOs citing higher optimism (green bars), lower optimism (blue bars), and
no change (gray bars); net optimism (line) is difference between the green and blue bars
80%

Net optimism declined for the second straight

60%
quarter after hitting a new high in 1Q18. This
quarter’s net optimism declined to +36 from +48%
+39, reaching its lowest level since 3Q17. 40%
+36%
CFOs expressing rising optimism remained
unchanged from last quarter (48%), while 20%
CFOs citing pessimism increased to 12% (up
from 9%). 0%
-12%
Net optimism for the US declined from +42 -20%
last quarter to +35 this quarter, below the
two-year average. Canada declined from +33
-40%
to +27, while Mexico rose sharply from zero
to +67—the highest level in four years.
-60%
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
1Q17
2Q17
3Q17
4Q17
1Q18
2Q18
3Q18
Sentiment was particularly strong in Services
(+75, a new high) and T/M/E (+50).
Healthcare/Pharma rose sharply from -33 to More optimistic More pessimistic No change Net optimism
+33, while Technology declined sharply from
+52 to +17.

Please see the full report for charts specific to Net optimism by country
individual industries and countries.
and industry (3Q18)
Manufacturing

Healthcare/
Technology

Resources
Wholesale

Financial
Services

Services
Energy/

Pharma
Canada
Mexico

Retail/

T/M/E
Total

US

+36.4 +34.8 +66.7 +27.3 +33.3 +45.5 +16.7 +41.2 +28.1 +33.3 +50.0 +75.0
Red = relative lows
Green = relative highs

9 Deloitte CFO Signals™

Expectations
Business focus for next year

Nearly all trends seen last quarter Business focus

continued, with increased biases toward What is your company’s business focus for the next year? Net percent of CFOs citing a
current geographies, current offerings, stronger focus on the top choice than on the bottom choice (e.g., grow revenue vs. reduce costs)
and organic growth (which has a new
survey high). Offense vs. defense
Grow revenue Offense Invest cash
Approximately 59% of surveyed CFOs say they 60%
39%
are biased toward revenue growth (near the 40%
two-year average), and 20% claim a bias 20%
37%
toward cost reduction for a net value of
0%
+39%—a slight shift toward cost reduction
-20%
from the previous quarter. The bias toward
investing cash over returning it to -40%
shareholders (56% versus 19%) decreased -60%
slightly (to +37%), but remains near the high Reduce costs Defense Return cash
levels we have seen over the past two years.
New business vs. current business
CFOs’ bias toward current versus new New business
New geographies New offerings
product/service offerings shifted back to 60%
current offerings this quarter (43% versus 40%
37%, for a net of -6%). The bias toward
20%
current geographies over new ones increased
somewhat (67% versus 16%, for a net of 0%
-6%
-51%), continuing the trend seen last quarter. -20%
-40%
The recent strong bias toward organic growth -60%
-51%
over inorganic growth continued this quarter Current geographies Current offerings
Current business
and reached another survey high (72% versus
15%, for a net of -57%). Inorganic growth vs. organic growth
Please see the full report for charts specific to Inorganic growth
individual industries. 60%
40%
20%
0%
-20%
-40%
-57%
-60%
Organic growth
10 Deloitte CFO Signals™
Expectations
Growth in key metrics, year-over-year

Coming off multi-year highs, most key growth Growth expectations

metrics declined, but remained strong. Mexico Compared to the past 12 months, how do you expect the following metrics to change
led growth expectations (similar to last over the next 12 months? CFOs’ expected year-over-year company growth in key metrics
quarter), and Canada lagged. Dividends rose (compared to the value of the S&P 500 index at the survey midpoint)
sharply, driven largely by Retail/Wholesale
20% 3000
and Energy/Resources. 2,833
18% 2700
Revenue growth declined from 6.3% to 6.1%, 16% S&P 500 price 2400
but remains at one of the highest levels in the last (right-hand axis)
four years. 14% 2100

12% 1800
Earnings growth declined from 10.3% to 8.1%,
the lowest level this year. The US declined, falling 10% 1500
below its two-year average. Canada fell sharply to 8% 1200
its lowest this year; Mexico also fell sharply, in line
with its three-year average. Technology and 6% 900

Retail/Wholesale are highest; Energy/Resources 4% 600

and Services are lowest.
2% 300
Capital investment declined from 10.4% to 0% 0
9.4%, the second consecutive decline, but remains
above the two-year average. The US fell from
recent highs, but remains above its two-year Revenue growth Earnings growth Dividend growth
average. Canada rose sharply and is above its two- Capital spending growth Domestic personnel growth Domestic wage growth

year average; Mexico rose sharply to its third

highest level in the last six years.
Energy/Resources and Retail/Wholesale are YOY growth expectations by
highest, Healthcare/Pharma and T/M/E are lowest.

Manufacturing
country and industry (3Q18)

Healthcare/
Technology

Resources
Wholesale
Domestic personnel growth fell from 3.2% to

Financial
Services

Services
Energy/

Pharma
Canada
Mexico
2.7%, but remains above its two-year average.

Retail/

T/M/E
Total

US

Dividend growth rose sharply from 4.8% to

7.4%, the highest level in eight years. The US rose Revenue 6.1% 5.9% 9.2% 5.1% 5.1% 7.9% 10.5% 6.1% 5.8% 6.8% 3.2% 4.6%
to an eight-year high; Mexico rose to a four-year Earnings 8.1% 8.4% 7.1% 5.6% 8.3% 9.5% 12.5% 5.6% 7.8% 9.3% 8.3% 6.1%
high; and Canada remained the same. Capital spending 9.4% 8.3% 19.1% 11.6% 9.7% 13.6% 6.4% 15.8% 6.6% 4.0% 5.3% 8.3%
Retail/Wholesale and Energy/Resources lead; Domestic personnel 2.7% 2.5% 5.9% 2.1% 2.4% 4.0% 6.3% 2.2% 2.6% 2.7% 0.0% 1.7%
Technology and T/M/E trail.
Dividends 7.4% 7.3% 12.2% 3.4% 7.6% 14.4% 0.0% 12.1% 6.0% 3.3% 2.8% 8.0%
Please see the full report for charts specific to Domestic wages 3.3% 3.2% 5.0% 2.8% 3.3% 4.0% 3.7% 3.3% 3.1% 3.1% 4.3% 2.8%
individual industries and countries. Red = relative lows
Green = relative highs
11 Deloitte CFO Signals™
Special topic: Future of finance work, workforces, & workplaces
Projected finance operations in three years

Surveyed CFOs expect the responsibilities Finance work expectations in three years
of their finance function to shift beyond Please note your level of agreement with the following statements about your finance
accounting, reporting, and compliance, team’s operations three years from now. Percent of CFOs selecting each level of
and are confident that their talent agreement for each statement
roadmap can support a technology-
enabled workforce in three years. Many The majority of the time spent by my finance
also believe that more work will likely workforce will likely be on analysis, prediction,
14% 22% 50% 13%
and decision support rather than accounting,
move to “shared service centers of reporting, and compliance.
excellence,” but CFOs are somewhat split
on what is to come for telework.
Most finance work will likely be undertaken in
Sixty-three percent of CFOs projected that the and delivered by real or virtual “shared service 4% 23% 28% 38% 7%
time allocation of the finance workforce in centers of excellence.”
three years will likely shift toward analysis,
prediction, and decision support. Sixty-six
percent of CFOs expect that technology will Technology will likely enable significant
likely enable productivity. productivity gains, and thus significant 7% 27% 46% 20%
workforce reductions, in accounting, reporting,
and compliance processes.
While 45% of CFOs reported that most finance
work would likely be via shared service
centers, nearly half disagreed that office space Office space required for finance workers will
for finance workers would be significantly likely be reduced by 30% or more. 5% 44% 23% 24% 4%

reduced (including 92% in Technology). More

than one-quarter believe there will likely be
significant office space reduction (including
67% of Healthcare/Pharma and 50% of Telecommuting and finance work in non-
traditional or non-company office locations will 8% 33% 28% 27% 4%
Services). likely increase dramatically.

CFOs were most divided on the future of

telecommuting for finance work. While 41%
believe that telework is not likely to increase I am confident in our talent roadmap to adjust
dramatically, 31% believe that it will. the finance workforce and work by utilizing 14% 32% 48% 6%
digital technologies.
Fifty-four percent of CFOs feel confident in
their finance talent roadmap, although at least 0% 50% 100%
25% of Retail/Wholesale and Technology CFOs
do not.
Strongly disagree Disagree Neutral Agree Strongly agree
Please see the full report for charts specific to
individual industries.
12 Deloitte CFO Signals™
Special topic: Future of finance work, workforces, & workplaces
Projected finance workforce dynamics

CFOs expect their companies’ participation CFOs’ workforce expectations

in the gig economy to grow by 88% in the Please provide your best percentage estimates of the following regarding estimated
next three years, with the bulk of the percentage of finance workforce: Workforce percentages today and in three years
workforce remaining nearshore. The
finance talent gap is expected to continue Percentage change

to grow.
Outsourced, contingent, contract, or 8.3%
CFOs reported that 8.3% of their finance gig workers providing finance work 88%
workforce consisted of outsourced, contingent, to our company 15.6%
contract, or gig workers, and that will likely
nearly double in three years. Services
anticipated the biggest change (12.2%) while
T/M/E expected the smallest (1.7%).
19.3%
The finance workforce operating in
The distribution of CFOs’ finance workforce in real or virtual shared services 65%
31.9%
real or virtual shared services is presumed to
rise significantly, from 19.3% to 31.9%.

Nearshore is a significant portion of CFOs’

finance workers (42.3%), and this is estimated
Our nearshore (e.g., within three 42.3%
to remain almost unchanged (43.6%), although time zones of HQ) finance 3%
Technology and Healthcare/Pharma noted a workforce, including contingent 43.6%
decrease in nearshore in three years. The workforce
distant offshore workforce was estimated to
climb from 15.4% to 22.0% in three years.
Energy/Resources is anticipating a large relative
change (from 1.9% to 5.9%) although the Our distant offshore (e.g., more than 15.4%
three time zones from HQ) finance 43%
largest expected absolute change is within workforce, including contingent 22.0%
Services from 8.9% to 21.5%. workforce

CFOs noted that 11.5% of their workforce does

not have the necessary skills for today’s finance Considering your current finance
function, and that would likely continue to workforce, what percent are not 11.5%
increase. Healthcare/Pharma had the highest sufficiently skilled to perform their 34%
roles today, and what percent will
levels (30% now and 33.8% in three years), likely not be skilled to undertake
15.4%
while Energy/Resources was the only industry future finance roles three years from
with a decrease (-2%). now?
0% 10% 20% 30% 40% 50%
Please see the full report for charts specific to
individual industries.
Today In three years
13 Deloitte CFO Signals™
Special topic: Future of finance work, workforces, & workplaces
Top skills for the finance organization of the future

Over two-thirds of surveyed CFO Top skills to develop in finance organizations

responses ranked analytical skills, digital
technologies/automation, and core
business skills as the most important
skills an organization needs to
develop/further develop to effectively
deliver finance in three years.
What are the top three skills your organization needs to develop/further develop to
effectively deliver finance three years from now? Paraphrasing and normalization of
CFOs’ most common free-form comments
Top skills responses

Analytical skills is the most common skill to

develop/further develop. CFOs specifically
listed data management, data analysis, data
science, analytical insights, budgeting and
forecasting, predictive analytics, and
statistical/trend analysis. Services and
Technology listed this most, while
Energy/Resources listed this least.

Another skill mentioned is digital

technologies/automation. In particular,
respondents were focused on artificial
intelligence, blockchain, digital literacy, ERP
work processes, process automation, and
robotics. Energy/Resources listed this most
(32%, only industry that listed this more often Targeted skills to develop for finance departments
than analytical skills).

CFOs’ third highest competency is core

26% 25% 17% 32%
business skills. Responses ranged from
business partnership and communication to
strategic thinking and decision-making. 0% 25% 50% 75% 100%
Manufacturing and Retail/Wholesale rated this
higher than digital technologies/automation.
Analytical skills Digital technologies/automation Core business skills Other
The “Other” category included a range of skills,
including talent, continuous improvement,
agility, and leadership.
Please see the full report for charts specific to
individual industries.
14 Deloitte CFO Signals™
Appendix
Longitudinal data and survey
background
Longitudinal trends
Cross-industry expectations and sentiment (last 24 quarters)

CFOs’ year-over-year expectations1

(Mean growth rate, median growth rate, percent of CFOs who expect gains, and standard deviation of responses2)

CFOs’ own-company optimism3 and equity market performance

1 All means have been adjusted to eliminate the effects of stark outliers. The “Survey mean” column contains arithmetic means since 2Q10.
2 Standard deviation of data winsorized to 5th/95th percentiles.
3 Averages for optimism numbers may not add to 100% due to rounding.

Please contact nacfosurvey@deloitte.com for data as far back as 2Q10.

16 Deloitte CFO Signals™

About the survey
Background
The Deloitte North American CFO Survey is a quarterly survey of CFOs from large, influential companies across North America. The
purpose of the survey is to provide these CFOs with quarterly information regarding the perspectives and actions of their CFO peers
across four areas: business environment, company priorities and expectations, finance priorities, and CFOs’ personal priorities.

Participation
This survey seeks responses from client CFOs across the United States, Canada, and Mexico. The sample includes CFOs from public
and private companies that are predominantly over $3B in annual revenue. Respondents are nearly exclusively CFOs. Participation is
open to all industries except for public sector entities.

Survey execution
At the opening of each survey period, CFOs receive an email containing a link to an online survey hosted by a third-party service
provider. The response period is typically two weeks, and CFOs receive a summary report approximately two weeks after the survey
closes. Only current and frequent responders receive the summary report for the first two weeks after the report is released.

Nature of results
This survey is a “pulse survey” intended to provide CFOs with information regarding their CFO peers’ thinking across a variety of
topics; it is not, nor is it intended to be, scientific in any way, including in its number of respondents, selection of respondents, or
response rate, especially within individual industries. Accordingly, this report summarizes findings for the surveyed population, but
does not necessarily indicate economy- or industry-wide perceptions or trends.

17 Deloitte CFO Signals™

IMPORTANT NOTES ABOUT THIS SURVEY REPORT:
Participating CFOs have agreed to have their responses aggregated and
presented.
This is a “pulse survey” intended to provide CFOs with quarterly information
regarding their CFO peers’ thinking across a variety of topics. It is not, nor is it
intended to be, scientific in any way, including in its number of respondents,
selection of respondents, or response rate, especially within individual
industries. Accordingly, this report summarizes findings for the surveyed
population but does not necessarily indicate economy- or industry-wide
perceptions or trends.
This publication contains general information only, and Deloitte is not, by means
of this publication, rendering accounting, business, financial, investment, tax,
legal, or other professional advice or services. This publication is not a
substitute for such professional advice or services, nor should it be used as a
basis for any decision or action that may affect your business. Before making
any decisions that may impact your business, you should consult a qualified
professional advisor.

About Deloitte
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